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Knox aimed at strengthening company’s position in business-to-business market

People look at devices at the Samsung stand at the Mobile World Congress in Barcelona Monday. (Albert Gea/Reuters)

By Michael LewisBusiness Reporter

Mon., Feb. 25, 2013

Despite a mounting competitive assault on its enterprise and emerging market turf, shares in BlackBerry posted a slight gain Monday thanks to bullish comments about the recently released BB Z10 smartphone.

“We have been surprised by the positive response,” CEO Thorsten Heins told a German language newspaper. He said the Waterloo-based mobile computing device maker has ordered a significant increase in Z10 production capacity.

“We exceeded our expectations, and the requirements were ambitious, he said, adding that “before we give out specific numbers, we want to . . . watch for awhile.”

Heins told the Frankfurter Allgemeine that a high proportion of devices on the new BlackBerry 10 platform are being bought by “new customers who previously had iPhones or Android smartphones.”

B.C.-based retailer Glentel Inc., meanwhile, said the BlackBerry Z10 “was the leading smartphone sold within its (330 Canadian locations) since the Canadian launch on Feb. 5,” outshining the iPhone and Galaxy S3.

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A Glentel spokeswoman said the information was released to BlackBerry last week and would not divulge hard numbers. The lack of detail on sales has fanned differences among industry observers about just how the long-awaited BlackBerry line is faring.

Analysts including Canaccord’s Michael Walkley say checks with retailers indicate a so-so-launch, while there’s also been speculation the new BlackBerry saw sellouts in some Canadian and U.K. stores only because of limited supply.

More information could be forthcoming on March 28 when BlackBerry, formerly known as Research In Motion Ltd., reports fourth quarter earnings.

Ramon Llamas, senior research analyst with IDC’s Mobile Devices unit, said the company’s focus is on the Z10 launch in markets including India, where the touchscreen device goes on sale this week targeting high-end users at $800 (U.S.), and in the U.S., where it is to debut in mid-March.

He said the company cannot afford to be distracted by rivals encroaching on its traditional strongholds, saying the best defence is a successful launch.

Llamas was referring to Korea’s Samsung Group, which introduced software over the weekend called Knox that aims to beef up security for corporate and government customers.

Among its features, Samsung Knox separates work and personal functions, sequestering enterprise into a password encrypted interface, similar to a BlackBerry feature called Balance.

Llamas said while Samsung is doing a good job of raising its profile in enterprise, BlackBerry remains the “gold standard.”

He said while Samsung may challenge the BlackBerry 10 platform and hardware in business and government circles, “a number of questions remain” about the vulnerability of its open-source Android platform to malware and other security threats.

MobileTrax principal mobile and wireless analyst Gerry Purdy added that Samsung enterprise software must submit to testing by carriers and IT departments, suggesting it will be several months before its full potential emerges.

Along with increasing pressure on its enterprise turf, BlackBerry is also facing new threats in developing markets including India, where Apple has introduced an installment payment plan to make the iPhone more affordable.

Apple and Samsung are among vendors pushing into international consumer segments with lower price phones to compete with Asian equipment makers and the legacy line of BlackBerry devices such as the Bold and Torch. Samsung recently introduced Rex phones targeting price conscious consumers and Nokia has unveiled new devices at the World Mobile Congress in Barcelona aimed at a similar demographic.

Alicia Keys, the recently appointed global creative director at BlackBerry, meanwhile, will kick off her BlackBerry sponsored Set The World On Fire Tour on March 7th in Seattle.

As her portion of the BlackBerry Keep Moving project, the company said she will be asking fans to send in portraits from their city to create a video that will be shown during performances.

“With their help, we’re going to create a really amazing music video that will show the world what’s possible when your imagination and BlackBerry’s innovative platform collide,” said Keys, who reportedly tweeted about BlackBerry this month using an iPhone.

Blackberry shares reversed a week-long decline on uncertainty over Z10 sales, rising .53 per cent to $13.25 in Nasdaq trading.

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